Payroll and Payment Procedures
Every month, employers must provide The Pensions Trust with full details of contributions applicable to each individual member. The Pensions Trust must receive contributions by the 14th of the calendar month following the month in which the contributions were deducted from the members' salaries. This will enable The Pensions Trust to process contributions by the 19th which is the legal deadline as set out in the Pensions Act 1995. Please note: You are legally obliged to remit contributions deducted from members' pay on time. If you don't The Pensions Regulator may fine your organisation. The Pensions Trust will not be responsible for any fines imposed.
The list of contributions must include the following information:
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• The Pensions Trust's Member Number;
• Member’s Surname;
• National Insurance Number;
• Forename/Initial (optional);
• Payroll Number (optional);
• Annual Pensionable Salary;
• Salary Effective Date;
• Contractual Hours;
• Full Time Equivalent Hours;
• Hours Effective Date;
• Monthly Pensionable Earnings;
• Member Contributions;
• Employer Contributions; and
• Additional Voluntary Contributions (AVCs).
Submitting contribution data online using eBusiness ensures that the data is validated and any queries are resolved before the data is loaded on the membership records. This will avoid any potential delays arising when settling members benefits and will improve the accuracy of the data recorded.
If you are not yet enrolled onto eBusiness, the short-term alternative is an Excel (or compatible) spreadsheet showing each of the above categories in a seperate column (the same information would be acceptable in a .CSV file). The columns should show only the required information and there must be only one row of imformation per member. There should also be a comments column for any relevant data changes, e.g. changes to salary, working hours, leavers, maternity leave, sick leave etc. and the date of the change.
This information should be sent password protected with agreed passwords by email to: contributions@thepensionstrust.org.uk or using the secured send facility available.
Your legal obligation
Whichever format is used, please note you are legally obliged to remit, on time, all contributions deducted from employees' pay. If you fail to do this, your organisation may be reported to The Pensions Regulator and could be fined. The Pensions Trust will not be responsible for any penalty imposed for late payment of contributions.
Member contributions – important note
If you have chosen age-banded contributions you must ensure systems are in place to enable you to change a member’s contribution rate on reaching age 30 and again on reaching age 40.
Members’ contributions will be increased on the 1st April following their 30th or 40th birthday.
Definition of pensionable earnings
For more information, please refer to the Employer Administration Guide - Defined Benefit, click here.
Please note pension contributions should not be deducted from holiday pay, (where this relates to outstanding holidays when an employee leaves employment) or payment in lieu of notice.
Where an employee leaves part way through the month, contributions should only be deducted for the portion of the month they are still employed and not for the whole month.
If contributions are deducted incorrectly you will be obliged to refund them to the employee via your payroll system to ensure Tax and National Insurance are deducted correctly.
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